HBA-MPA C.S.H.B. 2458 76(R)BILL ANALYSIS Office of House Bill AnalysisC.S.H.B. 2458 By: Yarbrough Licensing & Administrative Procedures 4/28/1999 Committee Report (Substituted) BACKGROUND AND PURPOSE Manufacturers and distributors of alcoholic beverages (upper tier) may conduct promotional activities on licensed retail premises that feature their brand or brands of product. These promotional activities generally include giving away promotional items of minimal value to consumers. In the course of these promotions, the upper tier businesses must check or confirm with the retailer that their product is available at the retailer's premises in advance of the event. Such advance coordination permits the proper and appropriate execution of customary promotional sales activities. C.S.H.B. 2458 specifies that a manufacturer or distributor of alcoholic beverages may prearrange or preannounce a promotional activity permitted by the Alcoholic Beverage Code. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 102.07, Alcoholic Beverage Code, by amending Subsection (a) and adding Subsection (g), as follows: (a) Makes a conforming change. (g) Provides that Subsection (a) (setting forth a number of prohibited activities for a person who owns or has an interest in the business of a distiller, brewer, rectifier, wholesaler or for others involved in an alcoholic beverage business) does not prohibit a permittee covered under that subsection from prearranging or preannouncing a promotional activity with a retailer to be held on the retailer's premises if the promotion is otherwise permitted by this code. Authorizes a holder of a wholesaler's or class B wholesaler's permit to prearrange a promotional activity only for distilled spirits or wine. Prohibits a permittee from: (1) preannouncing a promotion to a consumer, if the permittee is a holder of a wholesaler's or class B wholesaler's permit, unless otherwise permitted; or (2) preannouncing the purchase of wine or distilled spirits to a consumer. SECTION 2. Effective date: September 1, 1999. SECTION 3. Emergency clause. COMPARISON OF ORIGINAL TO SUBSTITUTE C.S.H.B. 2458 differs from the original bill in SECTION 1 (proposed Section 102.07(g), Alcoholic Beverage Code), by adding new language specifying that a permit holder is not prohibited from prearranging or preannouncing a promotional activity with a retailer to be held on the retailer's premises if the promotion is otherwise permitted by this code. The substitute also adds provisions authorizing a holder of a wholesaler's or class B wholesaler's permit to prearrange a promotional activity only for distilled spirits or wine, and prohibiting the permittee from preannouncing a promotion or the purchase of wine or distilled spirits to a consumer, rather than authorizing such in the original bill.